Payment group ISIS has reportedly earmarked $100m to compete with Google in mobile payments

With summer days dwindling, Google has less than two weeks to make good on its pledge to launch its Google Wallet mobile payment service.

Google Wallet is a mobile application service that will let owners of Sprint’s Samsung Nexus S 4G smartphones use their phone as a wallet at some 20 retailers and restaurants.

Wallet launch

Users tap their phones to a point-of-sale system made to pay for goods. Citi, MasterCard and First Data are enabling payments for Google Wallet, which leverages near field communication (NFC) to enable the smartphones and point-of-sale terminals to process purchase transactions.

The company aims to launch the service this summer in New York City and San Francisco. Wallet hasn’t launched yet, and there is no sign that it is coming with a little over two weeks left in the summer.

“Our hope is to make an announcement in the next few weeks but don’t have anything set yet,” a Google spokesperson told eWEEK earlier this month.

ISIS, the mobile payment group backed by Verizon Wireless, AT&T and T-Mobile, apparently isn’t taking any chances. Bloomberg said the carrier group, which unveiled its own tap-and-pay effort in July, plans to invest $100 million (£61m) to build out its mobile payment plans to challenge Wallet.

An ISIS spokesperson declined comment, referring all questions to the carriers themselves. A Verizon spokesperson Jeffrey Nelson told eWEEK: “We’re not commenting on this rumour.”

Bloomberg said the $100 million infusion in ISIS would go toward securing more banks and merchants. What’s interesting about this is, on paper, ISIS’ deck of cards has got Google Wallet’s deck soundly beaten.

ISIS’ access points for mobile payments are far superior. Google has only secured Sprint and its Nexus S 4G phone for the NFC-based service. The carriers will be able to offer ISIS across multiple NFC-based Android 2.3 “Gingerbread” handsets.

More importantly, ISIS has the support of the four top credit card providers under its belt. While Wallet has secured MasterCard to process payments, ISIS became the first mobile payment provider to ink all four major credit card providers: Visa, MasterCard, Discover and American Express for support in the United States.

Some analysts believe Google may have a trump card that ISIS doesn’t: incentive. The search engine will pair Wallet with Google Offers, the Groupon-like daily deals service that is currently live in New York City, San Francisco, the Bay Area and Portland. Google just promoted Offers on Google.com this past week.

“At least Google Wallet comes with Google Offers which provides a discount,” Current Analysis analyst Avi Greengart told eWEEK. “Mobile payment processors continue to believe that consumers will pay for things using their phones without offering them any incentive to do so.”

Other players

Of course, Wallet and ISIS aren’t the only mobile payment plays. PayPal has one, as industry watchers would logically expect of the payment provider. Unfortunately, so do credit card providers, the same companies partnering with ISIS.

There is American Express’ Serve, a digital payment platform that blends online, offline and mobile payment options into a single account. Serve will be integrated on mobile phones and tablets from Verizon Wireless.

Visa also unveiled a plan to coax retailers to install technology in their POS terminals that processes a card embedded with a computer chip. Consumers will complete transactions with a signature or PIN at the point of sale.

Choice is good for consumers, but too much choice without clarity muddies the waters. “The proliferation of different systems may actually make things worse, as it is even more confusing for retailers and consumers now,” Greengart said.

Another major complication is that there is no indication the majority of consumers are ready to pay by phone. Still, who can blame all of the companies with a stake on the mobile web for trying to get their piece of the pie?

Gartner said worldwide mobile payment users will surpass 141.1 million in 2011, with mobile payment volume expected to top $86.1 billion around the globe.